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Whether the High Court was justified in holding that the appellants were not entitled to any compensation even when their forest land is acquired by the government, merely because the appellants had not derived any

Kumaon and Garhwal Division

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                                                             REPORTABLE

           IN THE SUPREME COURT OF INDIA

                    CIVIL APPELLATE JURISDICTION

                    CIVIL APPEAL NO.  4772 OF 1998

Rajiv Sarin & Anr.                                                     .... 

Appellants

                                   Versus

State of Uttarakhand & Ors.                                               .... 

Respondents

                                JUDGMENT

Dr. MUKUNDAKAM SHARMA, J.

        The   present   Civil   Appeal   emanates   from   the   judgment
  1.

        and   order   dated   12th  August   1997   passed   by   the   High 

        Court   of   Judicature   at   Allahabad   in   Writ   Petition   No. 

        8927   of   1988,   whereby   the   Division   Bench   of   the   High 

        Court dismissed the writ petition filed by the appellants. 

        Whether the High Court was justified in holding that the 

        appellants   were   not   entitled   to   any   compensation   even 

        when   their   forest   land   is   acquired   by   the   government, 

        merely   because   the   appellants   had   not   derived   any 

                                Page 1 of 52

      income   from   the   said   forest,   is   one   of   the   several 

      important   questions   of   law   which   has   arisen   for 

      consideration in the present appeal.

      The   appellant's   father   Shri   P.   N.   Sarin   had   in   the   year
2.

      1945   acquired   proprietary   right   in   an   Estate   known   as 

      Beni   Tal   Fee   Simple   Estate   situated   in   Pargana 

      Chandpur,   Tehsil   Karan   Prayag,   District   Chamoli, 

      Uttarakhand   (hereinafter   referred   to   as  "the   property   in 

      question")   which   comprised   of   large   tracts   of   forest 

      spanning   in   and     around   1600   acres.     On   the   death   of 

      Shri P.N. Sarin in the year 1976 appellants succeeded to 

      the property in question. By a Gazette Notification dated 

      21st  December,   1977   under   Section   4-A   of   the  Kumaun  

      and   Uttarakhand  Zamindari Abolition  and  Land   Reforms  

      Act,   1960  (hereinafter   referred   to   as   "KUZALR   Act")   as 

      amended by the U.P. Act No. 15 of 1978, the rights, title 

      and   interest   of   every  hissedar  in   respect   of   forest   land 

      situated   in   the   specified   areas   ceased   with   effect   from 

      01st  January,   1978   and   the   same   were   vested   in   the 

      State   Government.   A   notice   issued   by   the   Assistant 

      Collector, Karan Prayag, District Chamoli, under Rule 2 

      of  the  Kumaun  and  Uttrakhand  Zamindari Abolition and  

                                Page 2 of 52

            Land Reform Rules, 1965  (hereinafter referred to as "the 

            KUZALR   Rules")   framed   under   the   KUZALR   Act   was 

            served upon the appellants intimating them that effective 

            from   1st  January,   1978,   the   rights,   title   and   interest   of 

            hissedar  in   respect   of   the   property   in   question   had 

            vested   in   the   State   Government   free   from   all 

            encumbrances and it invited objections and statement, if 

            any,   relating   to   the   compensation   qua   the   property   in 

            question. 

            Assailing   the   aforesaid   notice   issued   by   the   Assistant
      3.

            Collector,   the   appellants   preferred   a   writ   petition   under 

            Article 32 of the Constitution before this Court. On 13th 

            December   1978   while   disposing   the   aforesaid   writ 

            petition, this Court passed the following order

            "We   are   of   the   opinion   that   it   will   be   better   if   the 

            Petitioner   files   a   petition   under   Article   226   of   the 

            Constitution   in   the   High   Court.   This   Petition   is 

            therefore allowed to be withdrawn."

      Subsequently,   on   02nd  April   1979   the   appellants   filed
4.

      objections   to   the   notice   issued   by   the   Assistant   Collector 

      challenging   the   vires   of   the   KUZALR   Act   and   also   stating 

      that   no   profit   was   being   made   from   the   property   in 

                                        Page 3 of 52

      question. By an order dated 11th  April 1988, the Assistant 

      Collector   dismissed   the   objections   of   the   appellants   by 

      observing   that  that   he   had   no  jurisdiction   to   consider   the 

      legal validity of the KUZALR Act. With regard to the issue of 

      compensation,   the   Assistant   Collector   held   that   since   the 

      KUZALR   Act   does   not   provide   for   a   method   to   compute 

      compensation  in  cases   where  no  income   has  been  derived 

      from   the   forests,   the   appellants   were   not   entitled   to   any 

      compensation. 

      Feeling aggrieved, the appellants preferred a writ petition in
5.

      the  High Court of Judicature at Allahabad questioning the 

      legality   and   validity   of  the   order   of   the   Assistant   Collector 

      and also challenging  the constitutional validity of Sections 

      4A, 18(1)(cc) and 19(1)(b) of the KUZALR Act. By impugned 

      judgment   dated   12th         August   1997,   the   High   Court 

      dismissed the writ petition.

      Not   satisfied   with   the   judgment   rendered   by   the   High
6.

      Court,   the   appellants   preferred  a  Special  Leave   Petition  in 

      which leave was granted by this Court by order dated 11th 

      September 1998. By an order passed on 11th August, 2010, 

      this appeal was directed to be listed before the Constitution 

                                   Page 4 of 52

      Bench.   This   matter   was   thereafter   listed   before   the 

      Constitution   Bench   alongwith   other   connected   matters 

      wherein   also   the   issue   of   scope   and   extent   of   right   under 

      Article   300A   of   the   Constitution   of   India   was   one   of   the 

      issues to be considered.

7. We   heard   the   learned   senior   counsel   appearing   for   the 

      parties   in   respect   of   all   the   contentions   raised   before   us. 

      Before   addressing   the   rival   contentions   advanced   by   the 

      parties, it will be useful to throw some light on the relevant 

      legal   position   which   is   intrinsically   complex   and   requires 

      closer examination.

      The  Uttar   Pradesh   Zamindari   Abolition   and   Land   Reforms
8.

      Act, 1950  (hereinafter to be referred as "UPZALR Act") was 

      enacted  in   the   year   1950   and   the   UPZALR   Act   was   made 

      applicable to the whole of the State of U.P. except  inter-alia 

      the   areas   of   Kumaon,   Uttarakhand.   The   object   of   the 

      UPZALR   Act   as   quite   evident   from   its   statements   and 

      objects   are   to   provide   for   the   abolition   of   the   Zamindari 

      System   which   involves   intermediaries   between   the   tiller   of 

      the   soil   and   the   State   in   Uttar   Pradesh   and   for   the 

      acquisition  of   their   rights,   title   and   interest   and   to   reform 

                                   Page 5 of 52

      the   law   relating   to   land   tenure   consequent   upon   such 

      abolition   and   acquisition   and   to   make   provision   for   other 

      matters connected therewith. 

      Subsequently,   on   02nd            August   1960          Kumaun   and
9.

      Uttarakhand   Zamindari   Abolition   and   Land   Reforms   Act,  

      1960  was   enacted.   The   object   of   the   KUZALR   Act   is   to 

      provide for the acquisition of the rights, title and interests 

      of   persons   between   the   State   and   the   tiller   of   the   soil   in 

      certain areas of the Kumaun and Garhwal Divisions and for 

      the introduction of land reforms therein. It is important to 

      notice   that   the   original   KUZALR   Act   did   not   provide   for 

      vesting   of   private   forests,   and   the   definition   of   the   word 

      "land"   in   Section   3(10)   thereof   excluded   forest.       Section 

      3(10) of the KUZALR Act reads as follows:-

         "3(10).     "land"   means   land   held   or   occupied   for 

         purposes   connected   with   agriculture,   horticulture 

         or   animal   husbandry   which   includes   pisciculture 

         and poultry farming but shall not include a forest;"

       However, after the commencement of the  Constitution (42nd
10.

      Amendment)   Act,   1976  which   came   into   effect   from   03rd 

      January   1977   wherein   inter-alia   the   subject   "forests"   was 

      included in the Concurrent List of the Seventh Schedule of 

                                    Page 6 of 52

the Constitution as Entry 17A; the U.P. Zamindari Abolition  

(Amendment) Act, 1978 (U.P. Act 15 of 1978) was passed on 

30th  November   1977   whereby   KUZALR   Act   was   amended. 

In   the   preamble   and   Statement   of   Objects   and   Reasons 

necessitating   the   amendment,   it   is   stated   that   the 

amendment   act   amends   Kumaun   and   Uttarakhand 

Zamindari   abolition   and   Land   Reforms   Act,   1960   also.     It 

goes on to state that in the areas governed by the Principal 

Act   namely   the   Uttar   Pradesh   Zamindari   Abolition   and 

Land   Reforms   Act,   the   rights,   title   and   interest   of   ex-

intermediaries   in   respect   of   their   private   forests   were 

abolished   and   vested   in   State.       It   also   states   that   in   the 

areas   to   which   the   Kumaun   and   Uttarakhand   Zamindari 

Abolition and Land Reforms Act, 1960 apply, the hissedars 

(Intermediaries) continued to enjoy their rights in respect of 

their   private   forests   and   therefore   it   was   necessary   to 

remove the disparity as well by introducing an amendment 

in   the   nature   of   Section   4A.   Under   the   aforesaid 

amendment   to   the   KUZALR   Act,   Section   4A   was   added   to 

the KUZALR Act and private forests were brought within its 

purview. It will be useful to reproduce Section 4A, 18(1)(cc) 

and 19(1)(b) of the KUZALR Act which reads as follows:

                              Page 7 of 52

         "4-A.     Vesting   of   interest   of   hissedar   in   the   forest 

         land - With effect from January 1, 1978 the rights, 

         title   and   interest   of   every   hissedar   in   respect   of 

         forest   land   shall   cease   and   shall   vest   in   the   State 

         Government   free   from   all   encumbrances,   and   the 

         provisions   of   this   Chapter   and   Chapter   V   shall 

         mutatis   mutandis   apply   to   a   forest   land   as   they 

         apply to a khaikari land."

                              xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

         "18   (1)   (cc)   in   the   case   of   a   private   forest,   the 

         average annual income from such forest for a period 

         of   twenty   agricultural   years   immediately   preceding 

         the date of vesting;"

                      xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

         "19(1) (b) - in the case of a private forest, eight times 

         of the amount of average annual income from such 

         forest."

       Kumaun   and   Uttarakhand   Zamindari   Abolition   and   Land
11.

   Reforms Act, 1960, which is a State legislation received the 

   assent   of   the   President   of   India   on   10th  September,   1960. 

   The   amendment   brought   in   1978   through   UP   Act   15   of 

   1978   to   the   said   Act   also   received   the   assent   of   the 

   President on 26th April, 1978. 

12.At   the   outset   we   would   like   to   mention   that   there   is   no 

   specific   whisper   of   defence   raised   under   Articles   31A,   31B 

   and 31C of the Constitution in the Counter-Affidavit/Reply 

   filed by the State of Uttarakhand to the writ petition filed by 

                                   Page 8 of 52

   the appellants in the High Court nor even before this Court 

   but   an   attempt   was   made   to   argue   the   case   on   those 

   grounds   on   behalf   of   the   respondents.   As   there   is   no 

   mention of any of the aforesaid Articles of the Constitution 

   in   the   arguments   or   specific   pleadings   by   the   respondents 

   in   the   writ   petition,   the   question   of   deciding   the 

   applicability   of   those   provisions   of   the   Constitution   and 

   consequent protection of the Act, therefore, does not arise.

13.It   was   contended   by   Shri   K.K.   Venugopal,   learned   senior 

   counsel   appearing   for   the   appellants   that   the   original 

   KUZALR   Act,   1960   excluded   private   forests   [Section   6(1) 

   (4)],   since   the   vesting   of   private   forests   in   the   State   would 

   not be by way of agrarian reform. It was further contended 

   that the provision for agrarian reforms, therefore, should be 

   a   part   of   the   Act,   but,   in   the   present   case,   the   private 

   forests   so   acquired   under   Section   4A   of   the   KUZALR   Act 

   becomes the property of the State which is untenable.

14.It was further argued that in any event, under Section 4A 

   of   the   KUZALR   Act,   it   is   only   the   provisions   of   Chapter-II 

   and Chapter-V which shall apply to forests land while Rule 

   41   occurs   in   Chapter   IV   and   has   no   application   to   the 

                                 Page 9 of 52

  forests   covered   by   Section   4A,   and   hence   Rule   41   will   not 

  apply  to forests  acquired  under  Section 4A of the  KUZALR 

  Act.   Further,   if   Article   31A   of   the   Constitution   has   no 

  application,   then   the   law   has   to   be   tested   against   the 

  Constitution   as   it   stood   on   the   date   of   its   enactment,   i.e. 

  the   U.P.   Amendment   Act,   1978   bringing   forth   amendment 

  to KUZALR Act has to stand the test of Articles 14, 19 and 

  21   of   the   Constitution.   It   was   further   contended   that   the 

  said   Amendment   Act   would   be   invalid   since   the   mere 

  transfer   of   the   private   forests   to   the   State   would   by   itself 

  not be a public purpose and, furthermore, non-grant /total 

  absence   of   compensation   to   the   appellants,   while   granting 

  full   compensation   to   other   owners   of   private   forests   who 

  have   mismanaged   the   forests   or   clear-felled   the   forests, 

  would be violative of Article 14 of the Constitution.

       Per   contra   Shri   Parag   P.   Tripathi,   Ld.   Additional   Solicitor
15.

  General strenuously argued that that the entry "Acquisition 

  and   Requisitioning   of   property"   which   was   earlier   in   the 

  form   of   Entry   36/List-II   of   the   Seventh   Schedule   of   the 

  Constitution [which was subject to Entry  42/List-III  of  the 

  Seventh   Schedule   of   the   Constitution]   and   Entry   33/List-I 

  of   the   Seventh   Schedule   of   the   Constitution   provided   only 

                                  Page 10 of 52

   the field of legislative power and did not extend to providing 

   or         requiring      compensation.   The           requirement      of 

   compensation   in   the   event   of   "taking"   flows   only   from 

   Article 31(2) of the Constitution, which was repealed by the 

   Constitution   (44th  Amendment)   Act,   with   effect   from   26th 

   September, 1979.

16.As  far   as   the   question   of   alleged   discrimination  i.e.   giving 

   compensation to other owners and nil compensation to the 

   appellants   herein   is   concerned,   it   was   contended   by 

   Learned   Additional   Solicitor   General   that   merely   because 

   there   may   be   two   compensation   laws,   which   may   be 

   applicable, one of which provides for a higher compensation 

   than   the   other,   would   not   by   itself   make   the   provisions 

   discriminatory or violative of Article 14 of the Constitution.

17.It   is   settled   law   that   Agrarian   Reforms   fall   within   Entry 

   18/List-II   read   with   Entry   42/List-III   of   the   Seventh 

   Schedule of the Constitution.

       In the instant case, it cannot be denied that KUZALR Act,
18.

   1960   is   a   statutory   enactment,   dealing   with   the   agrarian 

   reforms.   Section   4   of   the   KUZALR   Act   provides   that   in 

   respect   of   non-forest   land,   State   Government   may   by 

                                Page 11 of 52

  notification   take   over   the   rights,   title   and   interests   of 

  hissedar. The  land so released is then dealt  with by giving 

  bhumidhari  rights/asami  rights   to   the   tillers   and   thereby 

  effectuating the purpose of agrarian reforms.

       It   is   important   to   notice   that   Section   4A   introduced   in
19.

  KUZALR   Act   by   the   UP   Amendment   Act   1978   does   not 

  require   any   notification   but   it   specifies   the   date   i.e.   01st 

  January 1978 and provides that the right, title and interest 

  of a  hissedar  in respect of forest land shall cease and vest 

  by   the   application   of   the   statute   itself   in   the   State 

  Government.   Section   8   of   the   KUZALR   Act   mandates   that 

  such   "hissedar"   becomes   by   operation   of   the   statute   a 

  "bhumidhar".       The   aforesaid   amendment   was   introduced 

  by way of amendment so as to bring the said act in parity 

  with the Principal Act, namely UP Zamindari Abolition and 

  Land Reforms Act wherein the rights, title and interest of an 

  intermediary   (hissedar)   was   abolished   and   vested   with   the 

  State   from   the   very   inception   of   the   said   Act   as   such 

  provision was part of the principal Act itself.

20.Further, Rule 41 of the KUZALR Rules, 1965 framed under 

  the   KUZALR   Act   declares   that   the   forests   belonging   to   the 

                                 Page 12 of 52

State shall be managed by "Goan Sabha or any other local 

authority   established"   upon   a   notification   issued   by   the 

State   Government.       The   Rule   41   of   the   KUZALR   Rules, 

1965 reads as follows:-

    "41.  Section 41 :  Management of land and things 

    belonging   to   State   -              At   any   time   after   the 

    appointed   date,   the   State   Government,   may,   by 

    notification published in the Gazette, declare that as 

    from   the   date   to   be   specified,   all   or   any   of   the 

    following things, namely, -

    (i)      lands,   whether   cultivable   or   otherwise,   except 

             land   for   the   time   being   comprised   in   any 

             holding or grove,

    (ii)     forests,

             trees, other than trees in a holding or in a grove
    (iii)
             or in abadi,

    (iv)     fisheries,

             Hats, bazars and melas, except hats, bazars and
    (v)
             melas   held   on   land   referred   to   in   Section   7   or 

             which   is   for   the   time   being   comprised   in   the 

             holding of a bhumidar, and

             Tanks, ponds, ferries, water-channels, pathways
    (vi)
             and abadi sites;

    Belonging to the State, shall be managed by the Goan 

    Sabha or any other local authority established for the 

    whole   or   part   of   the   village   in   which   the   things 

    specified   in   clauses   (i)   to   (vi)   are   situate,   subject   to 

    and in accordance with the provisions of Chapter VII 

    of   the   Uttar   Pradesh   Zamindari   Abolition   and   Land 

    Reforms   Act,   1950,   and   the   rules   made   thereunder, 

    as applicable to Kumaun and Uttarakhand Divisions:

                Provided  that  it   shall   be   lawful   for   the   State 

    Government   to   make   the   declaration   aforesaid 

                              Page 13 of 52

        subject   to   such   exceptions   or   conditions   as   may   be 

        specified in the notification."

21.  This   being   so,   it   clearly   brings   out   that   the   vesting   of 

   forest  land under the  KUZALR  Act are directly linked with 

   the   agrarian   reforms,   as   the   land   as   also   the   forest   are 

   managed by the Goan Sabha or any local authority dealing 

   with   the   rights   of   villagers   for   betterment   of   village 

   economy. So, where the land acquired by the State is to be 

   transferred   to   a   Goan   Sabha/Village   Panchayat   for   its 

   management   and   use   of   land   leading   to   betterment   of 

   village economy, the legislation is in the nature of agrarian 

   reforms.

22.  The   aforesaid   conclusions   arrived   at   by   us   find   support 

   from   the   Constitution   Bench   decision   of   this   Court   in 

   Ranjit   Singh   and   Others   Vs.   State   of   Punjab   and   Others 

   reported   in   [1965]   1   SCR   82.       In   the   said   decision,   the 

   Constitution Bench has stated thus:-

        "..........The   scheme   of   rural   development   today 

        envisages   not   only   equitable   distribution   of   land   so 

        that there is no undue imbalance in society resulting 

        in   a   landless   class   on   the   one   hand   and   a 

        concentration   of   land   in   the   hands   of   a   few   on   the 

        other,   but   envisages   also   the   raising   of   economic 

        standards   and   bettering   rural   health   and   social 

        conditions.   Provisions for the assignment of lands to 

        village   Panchayat   for   the   use   of   the   general 

                                Page 14 of 52

           community,   or   for   hospitals,   schools,   manure   pits, 

           tanning   grounds   etc.   ensure   for   the   benefit   of   rural 

           population   must   be   considered   to   be   an   essential 

           part of the redistribution of holdings and open lands 

           to   which   no   objection   is   apparently   taken.       If 

           agrarian reforms are to succeed, mere distribution of 

           land to the landless is not enough.   There must be a 

           proper planning of rural economy and conditions and 

           a body like the village Panchayat is best designed to 

           promote rural welfare than individual owners of small 

           portions of lands...."

         It   is   true   that   Section   4A   of   KUZALR   Act,   1960,   as
23.

  amended   by   the   UP   Amendment   Act   1978,   provides   that 

  Chapter   II   and   Chapter   V   of   the   KUZALR   Act  would   apply 

  mutatis   mutandis  and   Rule   41   of   the   KUZALR   Rules   is 

  relatable to Chapter IV of the KUZALR Act.     However, the 

  necessary consequence of Section 4A of the KUZALR Act is 

  that the forest land vests in the State and all that Rule 41 

  of   the   KUZALR   Rules   does   is   to   provide   how   the   lands 

  vested in the State including forest and non-forest land is to 

  be dealt with.   Thus, Rule 41 of the KUZALR Rules clearly 

  applies   to   forest   lands   as   it   has   been   specifically   so 

  mentioned in the said Rules as well which are vested in the 

  State   under   Section   4A   of   the   KUZALR   Act   and   therefore 

  have   become   the   land/property   of   the   State,   which   would 

  be managed by the Goan Sabha.   

                                  Page 15 of 52

Repugnancy and Article 254 of the Constitution

       Learned senior counsel appearing for the appellants raised
24.

  two   contentions   in   the   context   of   the   inter-relation   of   the 

  Indian   Forest   Act   1927  and   the   KUZALR   Act;   firstly,   the 

  case   of   alleged   discrimination   in   as   much   as   the   Central 

  Act   i.e.   the   Indian   Forests   Act   provides   for   compensation 

  under the  Land  Acquisition Act 1894, which is higher; and 

  secondly, the case of alleged repugnancy. 

       It   was   submitted   that   the   provisions   of   Section   18(1)(cc)
25.

  read   with   Section   19(1)(b)   of   KUZALR   Act   as   amended   by 

  the  UP  Amendment   Act  1978   are  repugnant  to  Section   37 

  and Section 84 of the  Indian Forests Act 1927, in so far as 

  no compensation is provided for under the U.P. Amendment 

  Act,   1978   for   private   forests   which   are   preserved   and 

  protected   through   prudent   management,   while   a   private 

  forest   which   is   neglected   or  mismanaged   to   which   Section 

  36  of  the  Indian  Forest Act,  1927  applies,  can  be  acquired 

  under   the  Land   Acquisition   Act,   1894  by   paying   market 

  value and solatium.

       However,   per   contra   the   Learned   Additional   Solicitor
26.

  General   appearing   for   the   respondents   contended   that   the 

                                 Page 16 of 52

  issue of repugnancy does not arise at all in the instant case 

  as  there  is  in fact  no  repugnancy  between  the  Central  Act 

  i.e. the Indian Forest Act, 1927 and KUZALR Act in as much 

  as the Central Act and KUZALR Act in pith and substance 

  operates in different subject matters. 

       It   was   submitted   by   Learned   Additional   Solicitor   General
27.

  that   once   the   pith   and   substance   of   the   aforesaid   two 

  legislations   viz.   KUZALR   Act   and   the  Indian   Forest   Act,  

  1927  is   examined,   the   following   picture   would   emerge: 

  firstly,   the   KUZALR   Act   is   an   enactment   under   Entry 

  18/List-II,   i.e.   "land"   read   with   Entry   42/List-III   of   the 

  Seventh   Schedule   of   the   Constitution.   It   was   further 

  submitted that at the highest, it can be said that KUZALR 

  Act is relatable to Entry 18 of List II and 42 of List-III of the 

  Seventh   Schedule   of   the   Constitution   and   if   at   all,   only 

  incidentally   trenches   in   the   legislative   field   of   Entry 

  17A/List-III   of   the   Seventh   Schedule   of   the   Constitution; 

  and   secondly,   the  Indian   Forest   Act,   1927  on   the   other 

  hand,   is   in   pith   and   substance   a   legislation   under   Entry 

  17-A/List-III i.e. "Forests" read with Entry 42/List-III of the 

  Seventh Schedule of the Constitution. 

                                Page 17 of 52

28.It   is   trite   law   that   the   plea   of   repugnancy   would   be 

   attracted   only   if   both   the   legislations   fall   under   the 

   Concurrent   List   of   the   Seventh   Schedule   of   the 

   Constitution.       Under   Article   254   of   the   Constitution,   a 

   State   law   passed   in  respect  of  a  subject  matter   comprised 

   in List III i.e. the Concurrent List of the Seventh  Schedule 

   of   the   Constitution   would   be   invalid   if   its   provisions   are 

   repugnant   to   a   law   passed   on   the   same   subject   by   the 

   Parliament and that too only in a situation if both the laws 

   i.e. one made by the State legislature and another made by 

   the   Parliament   cannot   exist   together.     In   other   words,   the 

   question   of   repugnancy   under   Article   254   of   the 

   Constitution   arises   when   the   provisions   of   both   laws   are 

   completely   inconsistent   with   each   other   or   when   the 

   provisions   of   both   laws   are   absolutely   irreconcilable   with 

   each other and it is impossible without disturbing the other 

   provision, or conflicting interpretations resulted into, when 

   both   the   statutes   covering   the   same   field   are   applied   to   a 

   given   set   of   facts.       That   is   to   say,   in   simple   words, 

   repugnancy between the two statutes would arise if there is 

   a   direct   conflict   between   the   two   provisions   and   the   law 

   made   by   the   Parliament   and   the   law   made   by   the   State 

                               Page 18 of 52

   Legislature   occupies   the   same   field.   Hence,   whenever   the 

   issue   of   repugnancy   between   the   law   passed   by   the 

   Parliament   and   of   State   legislature   are   raised,   it   becomes 

   quite   necessary   to   examine   as   to   whether   the   two 

   legislations   cover   or   relate   to   the   same   subject   matter   or 

   different.  

       It   is   by   now   a   well-established   rule   of   interpretation   that
29.

   the entries in the list being fields of legislation must receive 

   liberal construction inspired by a broad and generous spirit 

   and not a narrow or  pedantic approach.  This Court in the 

   cases   of  Navinchandra   Mafatlal  v.  CIT,  reported   in   AIR 

   1955 SC 58 and State of Maharashtra v. Bharat Shanti  

   Lal   Shah,  reported   in   (2008)   13   SCC   5   held   that   each 

   general  word should extend to all ancillary  and subsidiary 

   matters which can fairly and reasonably be comprehended 

   within   it.     In   those   decisions   it   was   also   reiterated   that 

   there shall always be a presumption of constitutionality in 

   favour of a statute and while construing such statute every 

   legally   permissible   effort   should   be   made   to   keep   the 

   statute within the competence of the State Legislature. 

30.As   and   when   there   is   a   challenge   to   the   legislative 

                                   Page 19 of 52

  competence,   the   courts   will   try   to   ascertain   the   pith   and 

  substance   of   such   enactment   on   a   scrutiny   of   the   Act   in 

  question. In this process, it would also be necessary for the 

  courts   to   examine   the   true   nature   and   character   of   the 

  enactment,   its   object,   its   scope   and   effect   to   find   out 

  whether the enactment in question is genuinely referable to 

  a field of the legislation allotted to the respective legislature 

  under  the  constitutional  scheme.   In  the  aforesaid  context 

  we now proceed to examine the nature and character of the 

  KUZALR   Act   and   examine   and   scrutinize   the   same   in   the 

  context of the Central Act, namely, the Indian Forests Act, 

  1927. 

       As   noted   hereinbefore,   Section   4A   was   introduced   in
31.

  KUZALR Act by an amendment in the year 1978 as a part 

  of   agrarian   reforms   and   not   by   a   separate   enactment,   as 

  was   done   in   the   case   of   the  UP   Private   Forests   Act,   1948. 

  Significantly,   the   agrarian   reforms   introduced   by   the 

  UPZALR   Act   were   not   brought   about   by   amending   the  UP  

  Private Forests Act, 1948. It is to be noticed that the Indian  

  Forest Act,  1927  and the  UP Private  Forests Act,  1948  that 

  deal broadly with the same field of,  inter-alia  conservation, 

  regulation,   etc.,   of   forests.   It   is   to   be   further   noticed   that 

                                Page 20 of 52

  the   UPZALR   Act   and   after   the   1978   amendment,   KUZALR 

  Act   do   not   deal   with   conservation   or   regulation   of   forests 

  but with agrarian reforms. In order to find out the subject 

  matter of an enactment, even in the context of enactments 

  relatable   to   List   III   of   the   Seventh   Schedule   of   the 

  Constitution,   passed   by   different   legislatures,   the   doctrine 

  of pith and substance can be relied upon and would apply.

       As discussed hereinbefore KUZALR Act is a law principally
32.

  relatable to Entry 18 (land) of List II read with Entry 42 in 

  List III of the Seventh Schedule of the Constitution and only 

  incidentally trenches upon "forest" i.e. Entry 17A/List-III of 

  the   Seventh   Schedule   of   the   Constitution.   This   is   so 

  because it is an enactment for agrarian reforms and so the 

  basic subject matter is "land". Since the land happens to be 

  forest   land,   it   spills   over   and   incidentally   encroaches   on 

  Entry   17A   i.e.   "forest"   as   well.   On   the   other   hand,   the 

  Central   Act   i.e.   the  Indian   Forests   Act  1927  is   relatable   to 

  Entry 17A read with entry 42, both of List III of the Seventh 

  Schedule   of   the   Constitution.   It   is   in   pith   and   substance 

  relatable   to   Entry   17A,   as   it   deals   with   "forests"   and   not 

  with   "land"   or   any   other   subject.   It  only   incidentally   spills 

  over  in the  field of Entry 42,  as it deals with "control over 

                              Page 21 of 52

  forest land and not property of the Government" and in that 

  context   Section   37,   as   an   alternative   to   management   of 

  forests   under   Section   36   of   the  Indian   Forests   Act   1927, 

  deals   with   the   grant   of   power   to   acquire   land   under   the 

  Land Acquisition Act 1894.

       This   Court   in   the   case   of  Glanrock   Estate   Private
33.

  Limited  v.  State   of   Tamil   Nadu,  reported   in  (2010)   10  

  SCC   96   observed   in   paragraph   45   of   the   Judgment   as  

  follows: 

         ".............we are of the view that the requirement of 

         public purpose and compensation are not legislative 

         requirements   of   the   competence   of   legislature   to 

         make   laws   under   Entry   18   List   II   or   Entry   42   List 

         III,   but   are   conditions   or   restrictions   under   Article 

         31(2) of the Constitution as the said article stood in 

         1969.   ................   Lastly,   in  pith   and  substance,   we 

         are   of   the   view   that   the   Janmam   Act   (24   of   1969) 

         was   in   respect   of   "land"   and   "land   tenure"   under 

         Entry 18 List II of the Constitution.

       It   is   quite   clear   that   the   KUZALR   Act   relates   to   agrarian
34.

  reforms and therefore it deals with the "land"; however, the 

  Central   Act   i.e.   the  Indian   Forests   Act   1927  deal   with 

  "forests"   and   its   management,   preservation   and   levy   of 

  royalty/fees   on   forest   produce.   KUZALR   Act   further 

  provides   for   statutory vesting,  i.e.,  statutory  taking  over  of 

  property   of  hissedar,   which   happens   to   be   1st  January 

                                   Page 22 of 52

  1978,   i.e.   the   statutorily   fixed   date.   Therefore,   this   forest 

  land becomes the property of the State Government and is 

  dealt with like land, which is acquired under Section 4A of 

  KUZALR Act. This emerges from a reading of Rule 41 of the 

  KUZALR   Rules   itself.   Further,   the   acquisition   under   the 

  KUZALR   Act   is   a   case   of   "taking"   upon   payment   of   an 

  amount, which is not intended to be the market price of the 

  rights acquired. On the other hand, the power of acquisition 

  under   Section   37   of   the  Indian   Forests   Act   1927  i.e.   the 

  Central   Act   is   an   acquisition   based   on   the   principles   of 

  public purpose and compensation. 

       Thus,   not   only   do   the   aforesaid   Acts   relate   to   different
35.

  subject matters, but the acquisitions mentioned therein are 

  conceptually   different.   The   Central   Act   i.e.   the  Indian  

  Forests   Act   1927  mainly   deals   with   the   management, 

  preservation   and   levy   of   royalty   on   transmit   of   forest 

  produce.   The  Indian   Forests   Act   1927  also   incidentally 

  provides for and empowers the State Government to acquire 

  any land which might be required to give effect to any of the 

  purposes   of   the   Act,   in   which   case   such   land   could   be 

  acquired   by   issuing   a   notification   under   Section   4   of   the 

  Indian   Forests   Act  1927.  This  however  is   to be  understood 

                                  Page 23 of 52

  as   an   incidental   power   vested   on   the   State   Government 

  which could be exercised for giving effect to the purposes of 

  the  Indian Forests Act 1927. While considering the issue of 

  repugnancy   what   is   required   to   be   considered   is   the 

  legislation in question as a whole and to its main object and 

  purpose   and   while   doing   so   incidental   encroachment   is   to 

  be ignored and disregarded.

       In   fact,   it   is   the  UP   Private   Forest   Act,   1948,   which   is   an
36.

  enactment   relatable   to   Entry   17A   of   List   III,   i.e.,   Forests, 

  read with Entry 42 of List III of the Seventh Schedule of the 

  Constitution,   i.e.,   acquisition   to   the   extent   of   "vested" 

  forests. It is this Act which covers a field similar to that of 

  the   Central   Act   and   therefore,   sought   and   obtained   the 

  permission   of   the   President   under   Section   76   of   the 

  Government of India Act.

       Thus, in the State, there are two Acts, which are applicable
37.

  viz. the  UP Private  Forests Act, 1948, which is in the same 

  field as the Central Act i.e. the  Indian Forest Act 1927  and 

  the   KUZALR   Act,  which   is   in   respect   of  a  different   subject 

  matter. 

38.For   repugnancy   under   Article   254   of   the   Constitution, 

                                    Page 24 of 52

  there is a twin requirement, which is to be fulfilled: firstly, 

  there has to be a "repugnancy" between a Central and State 

  Act; and secondly, the Presidential assent has to be held as 

  being   non-existent.   The   test   for   determining   such 

  repugnancy is indeed to find out the dominant intention of 

  the both legislations and whether such dominant intentions 

  of   both   the   legislations   are   alike   or   different.   To   put   it 

  simply, a provision in one legislation in order to give effect 

  to   its   dominant   purpose   may   incidentally   be   on   the   same 

  subject as covered by the provision of the other legislation, 

  but such partial or incidental coverage of the same area in 

  a different context  and to achieve  a different purpose does 

  not attract the doctrine of repugnancy. In nutshell, in order 

  to attract the doctrine of repugnancy, both the legislations 

  must be substantially on the same subject.

       Repugnancy   in   the   context   of   Article   254   of   the
39.

  Constitution is understood as requiring the fulfillment of a 

  "Triple   test"   reiterated   by   the   Constitutional   Bench   in  M.  

  Karunanidhi   v.   Union   of   India,   (1979)   3   SCC   431   @   page 

  443-444, which reads as follows:- 

           "24.   It   is   well   settled   that   the   presumption   is
         always in favour of the constitutionality of a statute
         and the onus lies on the person assailing the Act to 

                                 Page 25 of 52

  prove   that it  is   unconstitutional.  Prima  facie,  there
  does   not   appear   to   us   to   be   any   inconsistency
  between the State Act and the Central Acts. Before
  any   repugnancy   can   arise,   the   following   conditions
  must be satisfied:

  1.   That   there   is   a   clear   and   direct   inconsistency
  between the Central Act and the State Act.

  2.   That   such   an   inconsistency   is   absolutely
  irreconcilable.

  3. That the inconsistency between the provisions of
  the   two   Acts   is   of   such   nature   as   to   bring   the   two
  Acts   into   direct   collision   with   each   other   and   a
  situation   is   reached   where   it   is   impossible   to   obey
  the one without disobeying the other."

       In other words, the two legislations must cover the same
40.

  field.   This   has   to   be   examined   by   a   reference   to   the 

  doctrine  of pith  and substance.  In the  instant case,  the 

  KUZALR   Act   deals   with   agrarian   reforms   and   in   the 

  context deals with the private forests, this vests with the 

  State   and   would   therefore   be   managed   by   the   Goan 

  Sabha. The Indian Forest Act, 1927 which is the existing 

  Central law, has nothing to do with agrarian reforms but 

  deals  with forest  policy and management,  and therefore 

  is in a different field. Further, there is no direct conflict 

  or collision, as the  Indian Forest Act, 1927  only gives an 

  enabling   power   to   the   government   to   acquire   forests   in 

  accordance   with   the   provisions   of   the  Land   Acquisition  

  Act   1894,   whereas   KUZALR   Act   results   in   vesting   of 

  forests   from   the   dates   specified   in   Section   4A   of   the 

                            Page 26 of 52

  KUZALR   Act.   Consequently,   it   could   be   deduced   that 

  none   of   the   aforesaid   three   conditions   as   mentioned   in 

  the  decision  of  M.  Karunanidhi  case   (supra)   is   attracted 

  to the facts of the present case.

       The   only   other   area   where   repugnancy   can   arise   is
41.

  where   the   superior   legislature   namely   the   Parliament 

  has   evinced   an   intention   to   create   a   complete   code. 

  This   obviously   is   not   the   case   here,   as   admittedly   even 

  earlier,   assent   was   given   under   Section   107(2)   of   the 

  Government of India Act by the Governor General to the 

  U P Private Forests Act, 1948.

       This   Court   succinctly   observed   as   follows   in  Hoechst
42.

  Pharmaceuticals  Ltd.  v.  State  of  Bihar,  (1983)  4  SCC  45, 

  at page 87: 

         "67.  Article   254   of   the   Constitution   makes
  provision first, as to what would happen in the case
  of   conflict   between   a   Central   and   State   law   with
  regard   to   the   subjects   enumerated   in   the
  Concurrent   List,   and   secondly,   for   resolving   such
  conflict.   Article   254(1)   enunciates   the   normal   rule
  that in the event of a conflict between a Union and a
  State law in the concurrent field, the former prevails
  over the latter.  Clause (1) lays down that if a State
  law relating to a concurrent subject is `repugnant' to
  a Union law relating to that subject, then, whether
  the Union law is prior or later in time, the Union law
  will prevail and the State law shall, to the extent of
  such   repugnancy,   be   void.   To   the   general   rule   laid
  down in clause (1), clause (2) engrafts an exception
  viz.   that   if   the   President   assents   to   a   State   law 

                             Page 27 of 52

         which   has   been   reserved   for   his   consideration,   it
         will   prevail   notwithstanding   its   repugnancy   to   an
         earlier   law   of   the   Union,   both   laws   dealing   with   a
         concurrent subject. In such a case, the Central Act,
         will   give   way   to   the   State   Act   only   to   the   extent   of
         inconsistency   between   the   two,   and   no   more.   In
         short,   the   result   of   obtaining   the   assent   of   the
         President to a State Act which is inconsistent with a
         previous Union law relating to a concurrent subject
         would be that the State Act will prevail in that State
         and   override   the   provisions   of   the   Central   Act   in
         their   applicability   to   that   State   only.   The
         predominance   of   the   State   law   may   however   be
         taken   away   if   Parliament   legislates   under   the
         proviso   to   clause   (2).   The   proviso   to   Article   254(2)
         empowers the Union Parliament to repeal or amend
         a   repugnant   State   law,   either   directly,   or   by   itself
         enacting   a   law   repugnant   to   the   State   law   with
         respect   to   the   `same   matter'.   Even   though   the
         subsequent   law   made   by   Parliament   does   not
         expressly   repeal   a   State   law,   even   then,   the   State
         law will become void as soon as the subsequent law
         of Parliament creating repugnancy is made. A State
         law   would   be   repugnant   to   the   Union   law   when
         there   is   direct   conflict   between   the   two   laws.   Such
         repugnancy may also arise where both laws operate
         in the same field and the two cannot possibly stand
         together:   See   Zaverbhai   Amaidas   v.   State   of
         Bombay;   M.   Karunanidhi   v.   Union   of   India   and   T.
         Barai v. Henry Ah Hoe."

       Again   a   five-Judge   Bench   of   this   Court   while   discussing
43.

  the said doctrine in Kartar Singh v. State of Punjab, (1994) 3 

  SCC 589 @ page 630 observed as under: 

         "60. This doctrine of `pith and substance' is applied 

         when the legislative competence of a legislature with 

         regard to a particular enactment is challenged with 

         reference to the entries in the various lists i.e. a law 

         dealing with the subject in one list is also touching 

         on   a   subject   in   another   list.   In   such   a   case,   what 

         has   to   be   ascertained   is   the   pith   and   substance   of 

         the enactment. On a scrutiny of the Act in question, 

         if found, that the legislation is in substance one on a 

         matter   assigned   to   the   legislature   enacting   that 

         statute, then that Act as a whole must be held to be 

                                    Page 28 of 52

         valid notwithstanding any incidental trenching upon 

         matters   beyond   its   competence   i.e.   on   a   matter 

         included   in   the   list   belonging   to   the   other 

         legislature.          To          say          differently,         incidental 

         encroachment is not altogether forbidden."

       Further in Govt. of A.P. v. J.B. Educational Society, (2005) 3
44.

  SCC  212,  this Court  while  explaining the scope  of Articles 

  246   and   254   of   the   Constitution   and   considering   the 

  proposition laid down by this Court in M. Karunanidhi case 

  (supra)  with respect to the situations in which repugnancy 

  would arise, held as follows at page 219:

         "9.   Parliament   has   exclusive   power   to   legislate   with 

         respect   to   any   of   the   matters   enumerated   in   List   I, 

         notwithstanding   anything   contained   in   clauses   (2) 

         and (3) of Article 246. The non obstante clause under 

         Article   246(1)   indicates   the   predominance   or 

         supremacy of the law made by the Union Legislature 

         in   the   event   of   an   overlap   of   the   law   made   by 

         Parliament   with   respect   to   a   matter   enumerated   in 

         List   I   and   a   law   made   by   the   State   Legislature   with 

         respect   to   a   matter   enumerated   in   List   II   of   the 

         Seventh Schedule.

         10.   There   is   no   doubt   that   both   Parliament   and   the 

         State   Legislature   are   supreme   in   their   respective 

         assigned fields. It is the duty of the court to interpret 

         the   legislations   made   by   Parliament   and   the   State 

         Legislature in such a manner as to avoid any conflict. 

         However,   if   the   conflict   is   unavoidable,   and   the   two 

         enactments   are   irreconcilable,   then   by   the   force   of 

         the  non obstante  clause   in  clause   (1)  of  Article   246, 

         the         parliamentary               legislation         would          prevail 

         notwithstanding   the   exclusive   power   of   the   State 

         Legislature   to   make   a   law   with   respect   to   a   matter 

         enumerated in the State List.

         11.   With   respect   to   matters   enumerated   in   List   III 

                                          Page 29 of 52

  (Concurrent   List),   both   Parliament   and   the   State 

  Legislature   have   equal   competence   to   legislate.   Here 

  again,   the   courts   are   charged   with   the   duty   of 

  interpreting   the   enactments   of   Parliament   and   the 

  State   Legislature   in   such   manner   as   to   avoid   a 

  conflict.   If   the   conflict   becomes   unavoidable,   then 

  Article   245   indicates   the   manner   of   resolution   of 

  such a conflict."

  Thereafter,   this   Court,   in   para   12,   held   that   the 

  question   of   repugnancy   between   the   parliamentary 

  legislation and the State legislation could arise in the 

  following two ways: (SCC p. 220)

  "12.   ...   First,   where   the   legislations,   though   enacted 

  with   respect   to   matters   in   their   allotted   sphere, 

  overlap   and   conflict.   Second,   where   the   two 

  legislations   are   with   respect   to   matters   in   the 

  Concurrent   List   and   there   is   a   conflict.   In   both   the 

  situations,               parliamentary            legislation         will 

  predominate,   in   the   first,   by   virtue   of   the   non 

  obstante   clause   in   Article   246(1),   in   the   second,   by 

  reason   of   Article   254(1).   Clause   (2)   of   Article   254 

  deals   with   a   situation   where   the   State   legislation 

  having been reserved and having obtained President's 

  assent,   prevails   in   that   State;                this   again   is 

  subject   to   the   proviso   that   Parliament   can   again 

  bring   a   legislation   to   override   even   such   State 

  legislation."

       The   aforesaid   position   makes   it   quite   clear   that   even   if
45.

  both   the   legislations   are   relatable   to   List-III   of   the 

  Seventh   Schedule   of   the   Constitution,   the   test   for 

  repugnancy   is   whether   the   two   legislations   "exercise 

  their   power   over   the   same   subject   matter..."   and 

  secondly whether the law of Parliament was intended "to 

  be exhaustive to cover the  entire  field".      The answer to 

                               Page 30 of 52

  both   these   questions   in   the   instant   case   is   in   the 

  negative, as the Indian Forest Act 1927 deals with the law 

  relating   to   forest   transit,   forest  levy   and  forest  produce, 

  whereas   the   KUZALR   Act   deals   with   the   land   and 

  agrarian reforms.

46.In   respect   of   the   Concurrent   List   under   Seventh 

  Schedule   to   the   Constitution,   by   definition   both   the 

  legislatures viz. the Parliament and the State legislatures 

  are   competent   to   enact   a   law.       Thus,   the   only   way   in 

  which   the   doctrine   of   pith   and   substance   can   and   is 

  utilised in determining the question of repugnancy is to 

  find   out   whether   in   pith   and   substance   the   two   laws 

  operate and relate to the same matter or not.     This can 

  be   either   in   the   context   of   the   same   Entry   in   List   III   or 

  different Entries in List III of the Seventh Schedule of the 

  Constitution. In other words, what has to be examined is 

  whether   the   two   Acts   deal   with   the   same   field   in   the 

  sense   of   the   same   subject   matter   or   deal   with   different 

  matters.

47.The concept of repugnancy does not arise as far as the 

  American and Canadian Constitutions are concerned, as 

                             Page 31 of 52

  there   is   no   Concurrent   List   there,   nor   is   there   any 

  provision akin to Article 254 of the Constitution of India. 

  Repugnancy arises in the Australian Constitution, which 

  has   a   Concurrent   List   and   a   provision   i.e.   Section   107, 

  akin to Article 254 of the Constitution of India.

48.In the Australian cases, the concept of Repugnancy has 

  really been applied in the context of Criminal Law where 

  for   the   same   offence,   there   are   two   inconsistent   and 

  different   punishments,   which   are   provided   and   so   the 

  two   laws   cannot   co-exist   together.   To   put   it   differently, 

  an   area   where   the   two   Acts   may   be   repugnant   is   when 

  the Central Act evinces a clear interest to be exhaustive 

  and unqualified and therefore, occupies the entire field.

       In   a   Full   Bench   decision   of   this   Court   in   the   case   of
49.

  State   of   Maharashtra  v.  Bharat   Shanti   Lal   Shah,  (2008) 

  13 SCC 5, this Court observed as follows at page 23  : 

       "48.  Article   254   of   the   Constitution   succinctly 

       deals   with   the   law   relating   to   inconsistency 

       between   the   laws   made   by   Parliament   and   the 

       State   Legislature.   The   question   of   repugnancy 

       under   Article   254   will   arise   when   a   law   made   by 

       Parliament   and   a   law   made   by   the   State 

       Legislature occupies the same field with respect to 

       one of the matters enumerated in the Concurrent 

       List   and   there   is   a   direct   conflict   in   two   laws.   In 

                                 Page 32 of 52

       other   words,   the   question   of   repugnancy   arises 

       only   in   connection   with   subjects   enumerated   in 

       the   Concurrent   List.   In   such   situation   the 

       provisions   enacted   by   Parliament   and   the   State 

       Legislature   cannot   unitedly   stand   and   the   State 

       law will have to make way for the Union law. Once 

       it  is   proved   and  established   that   the   State   law   is 

       repugnant   to   the   Union  law,  the   State   law   would 

       become void but only to the extent of repugnancy. 

       At   the   same   time   it   is   to   be   noted   that   mere 

       possibility   of   repugnancy   will   not   make   a   State 

       law invalid, for repugnancy has to exist in fact and 

       it must be shown clearly and sufficiently that the 

       State law is repugnant to the Union law."

50.In   a   nutshell,   whether   on   account   of   the   exhaustive 

   code   doctrine   or   whether   on   account   of   irreconcilable 

   conflict   concept,   the   real   test   is   that   would   there   be   a 

   room   or   possibility   for   both   the   Acts   to   apply. 

   Repugnancy   would   follow   only   if   there   is   no  such   room 

   or possibility.

       Having discussed the law, as applicable in the aforesaid
51.

   manner and upon scrutiny of subject matters of both the 

   concurrent   Acts,   it   is   crystal   clear   that   no   case   of 

   repugnancy is made out in the present case as both the 

   Indian  Forest Act,  1927  and the KUZALR  Act operate   in 

   two   different   and   distinct   fields   as   pointed   out 

   hereinbefore. Accordingly, both the Acts are legally valid 

   and   constitutional.   That   being   so,   there   was   no 

                               Page 33 of 52

    requirement   of   obtaining   any   Presidential   assent. 

    Consequently, Article 254(2) of the Constitution has also 

    no application in the instant case. However, it would be 

    appropriate   to   discuss   the   issue   as   elaborate   argument 

    was made on this issue as well.

Presidential Assent and Article 254(2) of the Constitution

         The   issue   argued   was   whether   "General   Assent"   can
  52.

    always be sought and obtained by the State Government. 

    Reference was  made   to a  Constitutional  Bench   decision 

    of this Court in  Gram Panchayat Jamalpur  v.  Malwinder  

    Singh,   (1985)   3   SCC   661;   which   was   subsequently 

    further   interpreted   and   followed   in   the   case   of  P.N.  

    Krishna Pal v. State of Kerala, (1995) Suppl. 2 SCC 187.

         In   the  Gram   Panchayat   Jamalpur  case   (supra),   the
  53.

    Constitution Bench observed as follows at page 669:

           "13.   This   situation   creates   a   conundrum.   The 

    Central Act of 1950 prevails over the Punjab Act of 

    1953  by   virtue  of  Article  254(1)  of  the  Constitution 

    read   with   Entry   41   of   the   Concurrent   List;   and, 

    Article   254(2)   cannot   afford   assistance   to   reverse 

    that   position   since   the   President's   assent,   which 

    was   obtained   for   a   specific   purpose,   cannot   be 

    utilised   for   according   priority   to   the   Punjab   Act. 

    Though   the   law   made   by   the   Parliament   prevails 

    over   the   law   made   by   the   State   Legislature,   the 

    interest   of   the   evacuees   in   the   Shamlat-deh   lands 

                              Page 34 of 52

cannot   be   dealt   with   effectively   by   the   Custodian 

under   the   Central   Act,   because   of   the   peculiar 

incidents   and   characteristics   of   such   lands.   The 

unfortunate   result   is   that   the   vesting   in   the 

Custodian   of   the   evacuee   interest   in   the   Shamlat-

deh   lands   is,   more   or   less,   an   empty   formality.   It 

does   not   help   the   Custodian   to   implement   the 

provisions   of   the   Central   law   but,   it   excludes   the 

benign operation of the State law.

   14. The line of reasoning of our learned Brother, 

Chinnappa Reddy, affords a satisfactory solution to 

this constitutional impasse, which we adopt without 

reservation  of  any  kind.  The  pith  and   substance   of 

the Punjab Act of 1953 is "Land" which falls under 

Entry   18   of   List   II   (State   List)   of   the   Seventh 

Schedule   to   the   Constitution.   That   Entry   reads 

thus:

   "18.   Land,   that   is   to   say,   rights   in   or   over   land, 

land  tenures  including  the  relation of  landlord and 

tenant,   and   the   collection   of   rents;   transfer   and 

alienation   of   agricultural   land;   land   improvement 

and agricultural loans; colonisation."

Our learned Brother has extracted a passage from a 

decision   of   a   Constitution   Bench   of   this   Court   in 

Ranjit Singh v. State of Punjab3 which took the view 

that since,  the  Punjab Act of 1953  is  a  measure of 

agrarian   reform,   it   would   receive   the   protection   of 

Article   31-A.   It   may   be   recalled   that   the   Act   had 

received  the   assent   of   the   President   as  required   by 

the   first   proviso   to   that   article.   The   power   of   the 

State   Legislature   to   pass   laws   on   matters 

enumerated in the State List is exclusive by reason 

of   the   provision   contained   in   Article   246(3).   In   a 

nutshell,   the   position   is   that   the   Parliament   has 

passed a law on a matter which falls under Entry 41 

of   the   Concurrent   List,   while   the   State   Legislature 

has passed a law which falls under Entry 18 of the 

State List. The law passed by the State Legislature, 

being a measure of agrarian reform, is conducive to 

the welfare of the community and there is no reason 

why   that   law   should   not   have   effect   in   its   full 

amplitude.   By   this   process,   the   Village   Panchayats 

will   be   able   to   meet   the   needs   of   the   village 

                          Page 35 of 52

         community and secure its welfare. Accordingly, the 

         Punjab   Act   of   1953   would   prevail   in   the   State   of 

         Punjab over the Central Act of 1950, even insofar as 

         Shamlat-deh lands are concerned."

       Following   the   ratio   of  Gram   Panchayat   Jamalpur  case
54.

  (supra) this Court in the case of P.N. Krishna Pal v. State of  

  Kerala,   (1995)   Suppl.   2   SCC   187   observed   as   follows   at 

  page 200.

         "14.   In  Jamalpur   Gram   Panchayat   case3  the   facts 

         were   that   specific   assent   of   the   President   was 

         sought,   namely,   Article   31   and   Article   31-A   of   the 

         Constitution   vis-`-vis   Entry   18   of   List   II   of   the 

         Seventh Schedule of the Constitution. The President 

         had given specific assent. The Shamlat-deh lands in 

         Punjab were owned by the proprietors of the village, 

         in   proportion   to   their   share   in   the   property   of   the 

         lands   held   by   them.   After   the   partition,   the 

         proprietary   interests   in   the   lands   of   the   migrants 

         and proportionate to share of their lands vest in the 

         Union   of   India.   The   question   arose   whether   the 

         Punjab   Village   Common   Lands   (Regulation)   Act, 

         1953   prevails   over   Evacuee   Property   Act,   1950.   It 

         was   contended   that   in   view   of   the   assent   given   by 

         the President, the State Act prevails over the Central 

         Act. This Court in that context considered the scope 

         of   the   limited   assent.   Chandrachud,   C.J.   speaking 

         for majority, held that the Central Act, 1950 prevails 

         over   the   Punjab   Act,   1953   and   the   assent   of   the 

         President which was obtained for a specific purpose 

         cannot   be   utilised   for   according   precedence   to   the 

         Punjab   Act.   At   page   42,   placitum   `B'   to   `E',   this 

         Court held that

         "the assent  of the  President  under  Article  254(2)  of 

         the   Constitution   is   not   a   matter   of   idle   formality. 

         The   President   has,   at   least,   to   be   apprised   of   the 

         reason   why   his   assent   is   sought   if,  there   is   any  

         special   reason   for   doing   so.  If   the   assent   is   sought 

                                  Page 36 of 52

         and   given   in  general  terms  so  as  to  be   effective  for 

         all   purposes,   different   considerations   may 

         legitimately arise."

         Thus   it   is   clear   that   this   Court   did   not   intend   to 

         hold   that   it   is   necessary   that   in   every   case   the 

         assent   of   the   President   in   specific   terms   had   to   be 

         sought   and   given   for   special   reasons   in   respect   of 

         each   enactment   or   provision   or   provisions.   On   the 

         other hand, the observation clearly indicates that if 

         the   assent   is   sought   and   given   in   general   terms   it 

         would  be   effective   for   all  purposes.   In  other   words, 

         this Court observed that the assent sought for and 

         given   by   the   President   in   general   terms   could   be 

         effective   for   all   purposes   unless   specific   assent   is 

         sought   and   given   in   which   event   it   would   be 

         operative only to that limited extent."

       Further, in the case Kaiser-I-Hind (P) Ltd. v. National Textile
55.

  Corporation   (Maharashtra   North),   (2002)   8   SCC   182,   this 

  Court   made   it   clear   that   it   was   not   considering;   whether 

  the   assent   of   the   President   was   rightly   or   wrongly   given?; 

  and   whether   the   assent   given   without   considering   the 

  extent   and   the   nature   of   the   repugnancy   should   be   taken 

  as no assent at all? It observed as follows at page 203:

            "27.   In   this   case,   we   have   made   it  clear   that  we 

         are  not considering the question that the  assent  of 

         the   President   was   rightly   or   wrongly   given.   We   are 

         also   not   considering   the   question   that   --   whether 

         "assent"   given   without   considering   the   extent   and 

         the nature of the repugnancy should be taken as no 

         assent  at   all.  Further,   in  the   aforesaid   case,  before 

         the   Madras   High   Court   also   the   relevant   proposal 

         made   by   the   State   was   produced.   The   Court   had 

         specifically   arrived   at   a   conclusion   that   Ext.   P-12 

         shows that Section 10 of the Act has been referred 

                                   Page 37 of 52

         to   as   the   provision   which   can   be   said   to   be 

         repugnant   to   the   provisions   of   the   Code   of   Civil 

         Procedure   and   the   Transfer   of   Property   Act,   which 

         are   existing   laws   on   the   concurrent   subject.   After 

         observing   that,   the   Court   has   raised   the 

         presumption. We do not think that it was necessary 

         to   do   so.   In   any   case   as   discussed   above,   the 

         essential   ingredients   of   Article   254(2)   are:   (1) 

         mentioning of the entry/entries with respect to one 

         of   the   matters   enumerated   in   the   Concurrent   List; 

         (2) stating repugnancy to the provisions of an earlier 

         law   made   by   Parliament   and   the   State   law   and 

         reasons   for   having   such   law;   (3)   thereafter   it   is 

         required   to   be   reserved   for   consideration   of   the 

         President;   and   (4)   receipt   of   the   assent   of   the 

         President."

       It   is   in   this   context,   that   the   finding   of   this   Court   in
56.

  Kaiser-I-Hind (P) Ltd.  (supra)  at para 65 becomes important 

  to   the   effect   that   "pointed   attention"   of   the   President   is 

  required to be drawn to the repugnancy and the reasons for 

  having   such   a   law,   despite   the   enactment   by   Parliament, 

  has to be understood. It summarizes the point as follows at 

  page 215 as follows:

             "65. The result of the foregoing discussion is:

         1.   It   cannot   be   held   that   summary   speedier 

         procedure  prescribed under  the  PP Eviction Act for 

         evicting   the   tenants,   sub-tenants   or   unauthorised 

         occupants, if it is reasonable and in conformity with 

         the   principles   of   natural   justice,   would   abridge   the 

         rights conferred under the Constitution.

         2.   (a)   Article   254(2)   contemplates   "reservation   for 

         consideration   of   the   President"   and   also   "assent". 

         Reservation   for   consideration   is   not   an   empty 

         formality.   Pointed   attention   of   the   President   is 

                                   Page 38 of 52

  required to be drawn to the repugnancy between the 

  earlier   law   made   by   Parliament   and   the 

  contemplated   State   legislation   and   the   reasons   for 

  having   such   law   despite   the   enactment   by 

  Parliament.

         (b) The word "assent" used in clause (2) of Article 

  254   would   in   context   mean   express   agreement   of 

  mind to what is proposed by the State.

         (c) In case where it is not indicated that "assent" 

  is qua a particular law made by Parliament, then it 

  is open to the Court to call for the proposals made 

  by   the   State   for   the   consideration   of   the   President 

  before obtaining assent.

  3. Extending the duration of a temporary enactment 

  does   not   amount   to   enactment   of   a   new   law. 

  However   such   extension   may   require   assent   of   the 

  President in case of repugnancy."

       If   it   is   to   be   contended   that  Kaiser  lays   down   the
57.

  proposition   that   there   can   be   no   general   Presidential 

  assent,   then   such   an   interpretation   would   be   clearly 

  contrary to the observation of the Bench in Para 27 itself 

  where it states that it is not examining the issue whether 

  such an assent can be taken as an assent.

       Such an interpretation would also open the judgment to
58.

  a   charge   of   being,   with   respect,   per   in   curium   as   even 

  though   while   noting   the  Jamalpur  case   -   (1985)   3   SCC 

  661,   it   overlooks   the   extracts   in   the  Jamalpur  case 

  dealing with the aspect of general assent:

  "The assent of the President under Article 254(2) of 

                             Page 39 of 52

       the   Constitution   is   not   a   matter   of   idle   formality. 

       The   President   has,   at   least,   to   be   apprised   of   the 

       reason   why   his   assent   is   sought   if,   there   is   any 

       special reason for doing so.   If the assent is sought 

       and   given   in  general  terms  so  as  to  be   effective  for 

       all   purposes,   different   considerations   may 

       legitimately arise.   But if, as in the instant case, the 

       assent   of   the   President   is   sought   to   the   Law   for   a 

       specific purpose, the efficacy of the assent would be 

       limited   to   that   purpose   and   cannot   be   extended 

       beyond it."

Article 300A of the Constitution and Compensation 

59. After passing of the  Constitution (Forty Forth) Amendment  

Act 1978 which deleted Article 19(1)(f) and Article 31 from the 

Constitution and introduced Article 300A in the Constitution, 

the Constitution (44th  Amendment) Act inserted in Part XII, a 

new chapter:  "Chapter  IV  - Right to Property" and inserted  a 

new Article 300A, which reads as follows:-

       "No   person   shall   be   deprived   of   property   save   by 

       authority of law"

60.       It would be useful to reiterate paragraphs 3, 4 and 5 

of   the   Statement   of   Objects   and   Reasons   of   the   Constitution 

(44th Amendment) Act which reads as follows:-

       "3. In view of the special position sought to be given 

       to   fundamental   rights,   the   right   to   property,   which 

       has   been   the   occasion   for   more   than   one 

       Amendment of the Constitution, would cease to be a 

       fundamental   right   and   become   only   a   legal   right. 

       Necessary   amendments   for   this   purpose   are   being 

       made   to   Article   19   and   Article   31   is   being   deleted. 

                                 Page 40 of 52

       It   would,   however,   be   ensured   that   the   removal   of 

       property   from   the   list   of   fundamental   rights   would 

       not   affect   the   right   of   minorities   to   establish   and 

       administer educational institutions of their choice.

       4.          Similarly,  the  right  of persons holding  land 

       for   personal   cultivation  and  within  the  ceiling   limit 

       to receive compensation at the  market value  would 

       not be affected.

       5.          Property, while ceasing to be a fundamental 

       right,  would,  however,  be  given   express  recognition 

       as   a   legal   right,   provision   being   made   that   no 

       person   shall   be   deprived   of   his   property   save   in 

       accordance with law."

61.          The   incident   of   deprivation   of   property   within   the 

meaning of Article 300A of the Constitution normally occurred 

mostly   in   the   context   of   public   purpose.   Clearly,   any   law, 

which   deprives   a   person   of   his   private   property   for   private 

interest,   will   be   amenable   to   judicial   review.       In   last   sixty 

years,   though   the   concept   of   public   purpose   has   been   given 

quite   wide   interpretation,   nevertheless,   the   "public   purpose" 

remains   the   most   important   condition   in   order   to   invoke 

Article 300A of the Constitution.

62.          With   regard   to   claiming   compensation,   all   modern 

constitutions   which   are   invariably   of   democratic   character 

provide   for   payment   of   compensation   as   the   condition   to 

exercise   the   right   of   expropriation.   Commonwealth   of 

                                Page 41 of 52

Australia   Act,   a   French   Civil   Code   (Article   545),   the   5th 

Amendment   of   the   Constitution   of   U.S.A.   and   the   Italian 

Constitution   provided   principles   of   "just   terms",   "just 

indemnity",   "just   compensation"   as   reimbursement   for   the 

property taken, have been provided for. 

63.       Under   Indian   Constitution,   the   field   of   legislation 

covering   claim   for   compensation   on   deprivation   of   one's 

property   can   be   traced   to   Entry   42   List   III   of   the   Seventh 

Schedule   of   the   Constitution.   The                Constitution   (7th 

Amendment) Act, 1956 deleted Entry 33 List I, Entry 36 List II 

and   reworded   Entry   42   List   III   relating   to   "acquisition   and 

requisitioning   of   property".   The   right   to   property   being   no 

more   a   fundamental   right,   a   legislation   enacted   under   the 

authority   of   law   as   provided   in   Article   300A   of   the 

Constitution   is   not   amenable   to   judicial   review   merely   for 

alleged violation of Part III of the Constitution. Article 31A was 

inserted   by   the  Constitutional   (1st  Amendment)   Act,   1951  to 

protect   the   zamindari   abolition   laws.   The   right   to   challenge 

laws   enacted   in   respect   of   subject   matter   enumerated   under 

Article   31A  (1)   (a)  to  (g)   of  the   Constitution on  the   ground  of 

violation   of   Article   14   was   also   constitutionally   excluded. 

Further,   Article   31B   read   with   Ninth   Schedule   of   the 

                               Page 42 of 52

Constitution protects  all laws even if they are violative of the 

Part III of the Constitution. However, it is to be noted that in 

the   Constitutional   Bench   decision   in  I.   R.   Coelho   v.   State   of  

Tamil Nadu (2007) 2 SCC 1, this Court has held that the laws 

added to the Ninth Schedule of the Constitution, by violating 

the   constitutional   amendments   after   24.12.1973,   would   be 

amenable to judicial review on the ground like basic structure 

doctrine. 

64.       It has been contended by ld. senior counsel appearing 

for   the   appellants   that   the   action   taken   by   the   respondents 

must   satisfy   the   twin   principles   viz.   public   purpose   and 

adequate   compensation.               It   has   been   contended   that 

whenever there is arbitrariness by the State in its action, the 

provisions   of   Article   14,   19   and   21   would   get   attracted   and 

such action is liable to be struck down. It was submitted that 

the   KUZALR   Act   does   not   provide   for   any   principle   or 

guidelines   for   the   fixation   of   the   compensation   amount   in   a 

situation   when   no   actual   income   is   being   derived   from   the 

property   in   question.   It   was   further   submitted   that   the 

inherent   powers   of   public   purpose   and   eminent   domain   are 

embodied   in   Article   300A,   and   Entry   42   List   III,   "Acquisition 

                                Page 43 of 52

and   Requisitioning   of   Property"   which   necessarily   connotes 

that the acquisition and requisitioning of property will be for a 

public   use   and   for   compensation   and   whenever   a   person   is 

deprived  of  his  property,   the   limitations  as  implied   in   Article 

300A as well as Entry 42 List III will come into the picture and 

the Court can always examine the legality and validity of the 

legislation in question. It was further submitted that awarding 

nil   compensation   is   squarely   amenable   to   judicial   review 

under Articles 32 and 226 of the Constitution of India.

65.      It   is   the   case   of   the   State   that   the   statutory   scheme 

under the UPZALR Act, 1950 is provided in Section 39(1) (e) in 

respect  of  forests.   The   said  section   provides  for   two  methods 

for computation of compensation, namely, the average annual 

income of last 20 to 40 years as provided in Section 29(1) (e) 

(i)  and the estimate  of annual yield  on  the date  of vesting  as 

provided in Section 39(1) (e) (ii). It was further argued that in 

respect of KUZALR Act, the same U.P. Legislature which had 

the   example   of   Section   39(1)(e)   deliberately   dropped   the 

second   sub-clause   and   limited   the   compensation   only   to   the 

average annual income of the last 20 years. From this it was 

argued that where there is no annual income, there would be 

no compensation.

                               Page 44 of 52

66.       It  had   been   further   argued   that  since   the   expression 

"average   annual   income"   under   Section   39(1)   (e)   (i)   has 

already   been  judicially  interpreted in  the  case  of  Ganga Devi  

v.   State   of   U.P.  (1972)   3   SCC   126   to   mean   "actual"   annual 

income and not an estimate, therefore, if the forest land is not 

earning any income, then in the statutory formula set out in 

KUZALR Act, it would not be entitled to any compensation.

67.       The   Government   is   empowered   to   acquire   land   by 

exercising   its   various   statutory   powers.   Acquisition   of   land 

and   thereby   deprivation   of   property   is   possible   and 

permissible   in   accordance   with   the   statutory   framework 

enacted.   Acquisition   is   also   permissible   upon   exercise   of 

police power of the State. It is also possible and permissible to 

acquire   such   land   by   exercising   the   power   vested   under   the 

Land   Acquisition   Act.   This   Act   mandates   acquisition   of   land 

for public purpose or public use, which expression is defined 

in the Act itself. This Act also empowers acquisition of land for 

use   of   companies   also   in   the   manner   and   mode   clearly 

stipulated   in   the   Act   and   the   purpose   of   such   acquisition   is 

envisaged in the Act as not public purpose but for the purpose 

specifically enumerated in Section 40 of the Land Acquisition 

                               Page 45 of 52

Act. But, in case of both the aforesaid  manner of acquisition 

of land, the Act envisages payment of compensation for such 

acquisition   of   land   and   deprivation   of   property,   which   is 

reasonable and just.

68.       Article   31(2)   of   the   Constitution   has   since   been 

repealed by the Constitution (44th Amendment) Act 1978. It is 

to be noted that Article 300A was inserted by the Constitution 

(44th  Amendment)   Act,   1978   by   practically   reinserting   Article 

31(1)   of   the   Constitution.   Therefore,   right   to   property   is   no 

longer   a   fundamental   right   but   a   right   envisaged   and 

conferred by the Constitution and that also by retaining only 

Article   31(1)   of   the   Constitution   and   specifically   deleting 

Article 31(2), as it stood.  In view of the aforesaid position the 

entire   concept   to   right   to   property   has   to   be   viewed   with   a 

different   mindset   than   the   mindset   which   was   prevalent 

during   the   period   when   the   concept   of   eminent   domain   was 

the embodied provision of fundamental rights.   But even now 

as   provided   under   Article   300A   of  the   Constitution  the   State 

can proceed to acquire land for specified use but by enacting 

a   law   through   State   legislature   or   by   Parliament   and   in   the 

manner   having   force   of   law.     When   the   State   exercises   the 

power   of   acquisition   of   a   private   property   thereby   depriving 

                                Page 46 of 52

the private person of the property, provision is generally made 

in the statute to pay compensation to be fixed or determined 

according to the criteria laid down in the statute itself. It must 

be   understood   in   this   context   that   the  acquisition   of   the 

property by the State in furtherance of the Directive Principles 

of State Policy was to distribute the material resources of the 

community   including   acquisition   and   taking   possession   of 

private   property   for   public   purpose.   It   does   not   require 

payment   of   market   value   or   indemnification   to   the   owner   of 

the property expropriated. Payment of market value in lieu of 

acquired   property   is   not   a   condition   precedent   or   sine   qua 

non   for   acquisition.   It   must   be   clearly   understood   that   the 

acquisition   and   payment   of   amount   are   part   of   the   same 

scheme   and   they   cannot   be   separated.   It   is   true   that   the 

adequacy of compensation cannot be questioned in a court of 

law,   but   at   the   same   time   the   compensation   cannot   be 

illusory. 

69.       Further, it  is  to  be clearly understood  that the  stand 

taken   by   the   State   that   the   right,   title   or   interests   of   a 

hissedar      could   be   acquired   without   payment   of   any 

compensation,   as   in   the   present   case,   is   contrary   to   the 

express   provisions   of   KUZALR   Act   itself.     Section   12   of   the 

                               Page 47 of 52

KUZALR   Act,   1960   states   that   every  hissedar  whose   rights, 

title or interest are acquired under Section 4, shall be entitled 

to receive and be paid compensation.   Further, Section 4A of 

the KUZALR Act makes it clear that the provisions of Chapter 

II   (Acquisition   and   Modifications   of   existing   rights   in   Land), 

including Section 12, shall apply  mutatis mutandis  to a forest 

land as they apply to a khaikhari land.   Further, the intention 

of   the   legislature   to   pay   compensation   is   abundantly   clear 

from   the   fact   that   Section   19   itself   prescribes   that   the 

compensation payable to a hissedar under Section 12 shall, in 

the   case   of   private   forest,   be   eight   times   the   amount   of 

average annual income from such forest. In the instant case, 

income also includes possible income in case of persons who 

have   not   exploited   the   forest   and   have   rather   preserved   it. 

Otherwise,   it   would   amount   to   giving   a   licence   to 

owners/persons   to   exploit   forests   and   get   huge   return   of 

income and not to maintain and preserve it. The same cannot 

be   said   to   be   the   intention   of   the   legislature   in   enacting   the 

aforesaid   KUZALR   Act.   In   fact,   the   persons   who   are 

maintaining   the   forest   and   preserving   it   for   future   and 

posterity cannot be penalised by giving nil compensation only 

because of the reason that they were in fact chose to maintain 

                                 Page 48 of 52

the forest instead of exploiting it. 

70.       We are of the considered view that the decision of this 

Court   in  Ganga  Devi  (supra)   is   not   applicable   in   the   present 

case   in   as   much   as   this   Court   in  Ganga   Devi  (supra)   never 

dealt   with   a   situation   of   unexploited   forest   and   the 

interpretation of actual income was done in the peculiar facts 

and   circumstances   of   the   said   case.   The   said   case   does   not 

deal   with   a   situation   where   there   could   be   such   income 

possible   to   be   derived   because   it   was   unexploited   but   there 

could  be   no income  derived  immediately   even   if  it  is   used  or 

exploited.   Therefore,   the   said   case   is   clearly   distinguishable 

on facts. A distinction and difference has been drawn between 

the   concept   of   `no   compensation'   and   the   concept   of   `nil 

compensation'.  As mandated by Article 300A, a person can be 

deprived   of   his   property   but   in   a   just,   fair   and   reasonable 

manner.     In   an   appropriate   case   the   Court   may   find   `nil 

compensation'   also   justified   and   fair   if   it   is   found   that   the 

State   has   undertaken   to   take   over   the   liability   and   also   has 

assured   to   compensate   in   a   just   and   fair   manner.     But   the 

situation   would   be   totally   different   if   it   is   a   case   of   `no 

compensation' at all. As already held `a law seeking to acquire 

private   property   for   public   purpose   cannot   say   that   `no 

                                Page 49 of 52

compensation'   would   be   paid.     The   present   case   is   a  case   of 

payment of `no compensation' at all.  In the case at hand, the 

forest land which was vested on the State by operation of law 

cannot  be   said   to   be   non-productive   or  unproductive   by   any 

stretch of imagination. The property in question was definitely 

a   productive   asset.   That   being   so,   the   criteria   to   determine 

possible  income on  the  date  of  vesting   would  be  to  ascertain 

such   compensation   paid   to   similarly   situated   owners   of 

neighboring   forests   on   the   date   of   vesting.   Even   otherwise, 

revenue authority can always make an estimation of possible 

income on the date of vesting if the property in question had 

been   exploited   by   the   appellants   and   then   calculate 

compensation on the basis thereof in terms of Sections 18(1) 

(cc) and 19(1) (b) of KUZALR Act. We therefore find sufficient 

force   in   the   argument   of   the   counsel   for   the   appellants   that 

awarding   no   compensation   attracts   the   vice   of   illegal 

deprivation   of   property   even   in   the   light   of   the   provisions   of 

the Act and therefore amenable to writ jurisdiction.

71.       That being so, the omission of the Section 39(1) (e) (ii) 

of   the   UPZALR   Act   1950   as   amended   in   1978   is   of   no 

consequence   since   the   UPZALR   Act   leaves   no   choice   to   the 

State   other   than   to   pay   compensation   for   the   private   forests 

                                Page 50 of 52

acquired by it in accordance with the mandate of the law.  

72.       In   view   of   the   above,   the   present   appeal   is   partly 

allowed   while   upholding   the   validity   of   the   Act   and 

particularly   Sections   4A,   18(1)   (cc)   and   19   (1)   (b)   of   the 

KUZALR   Act,   we   direct   the   second   respondent,   i.e.   Assistant 

Collector   to   determine   and   award   compensation   to   the 

appellants   by   following  a  reasonable   and  intelligible   criterion 

evolved on the aforesaid guidelines provided and in light of the 

aforesaid   law   enunciated   by   this   Court   hereinabove.   The 

appellants   will   also   be   entitled   to   interest   @   six   percent   per 

annum   on   the   compensation   amount   from   the   date   of 

dispossession till the date of payment provided possession of 

the   forest   was   handed   and   taken   over   formally   by   the 

Respondent physically and provided the appellant  was totally 

deprived   of   physical   possession   of   the   forest.     However,   we 

would   like   to   clarify   that   in   case   the   physical/actual 

possession has not been handed over by the appellants to the 

State   government   or   has   been   handed   over   at   some 

subsequent  date i.e.  after the date of vesting, the interest  on 

the   compensation   amount   would   be   payable   only   from   the 

date of actual handover/physical possession of the property in 

question   and   not   from   the   date   of   vesting.   In   terms   of   the 

                                Page 51 of 52

aforesaid findings, the present appeal stands disposed of. No 

costs. 

                                                 .........................................CJI

                                                       [ S.H. Kapadia ]

                                                 ............................................J

                                                               [Dr.   Mukundakam 

Sharma]

                                                 ............................................J

                                                       [ K. S. Radhakrishnan ]

                                            ............................................J

                                                       [ Swatanter Kumar ]

                                            ............................................J

                                                      [ Anil R. Dave ]

New Delhi,

August 9, 2011.                                       Page 52 of 52

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